American Banks' Loan-To-Deposit Ratio Is At A 30-Year Low

The chart to the right shows US total loan balances relative to
bank deposits over the past couple of years. The total loan
growth rate continues to deteriorate while deposits grow.

In fact the ratio of these two measures, the so-called
loan-to-deposit ratio is now at the lowest level in some 30
years.

This creates material headwinds for economic growth.
Unfortunately there is no evidence that the current monetary
policy will reverse the trend of weakening loan growth. And as we
all know, the US fiscal policy (if one could call it that) is not
going to help much either...